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Assume at the end of the year, a firm's CFS has a small negative ending value for their Cash and Marketable Securities. Without looking at

Assume at the end of the year, a firm's CFS has a small negative ending value for their Cash and Marketable Securities. Without looking at the accrual income statement, you also know that the TIE ratio is 1.5. Based on these details, should the firm be able to pay its full interest expense for the current period?

a)

No, because the EBT is less than the interest expense

b)

No, because the EBIT is less than the interest expense

c)

No, because the firm does not have enough cash

d)

Yes, because the EBIT is greater than the interest expense

e)

Cannot determine with information provided

f)

Yes, but they can only pay it by borrowing more money

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